Complete Celebrity Catering Service Inc.s (CCS) Federal Form 1120 and all related schedules for the tax period indicated in the financial statements provided. Be sure to attach schedules f
Complete Celebrity Catering Service Inc.’s (CCS) Federal Form 1120 and all
related schedules for the tax period indicated in the financial statements
provided. Be sure to attach schedules for any line item, which indicates one is
required on the 1120.
Due Date: Wednesday, September 21st at 11:59 pm
Purpose: The purpose of this is not merely to learn how to fill-in forms but to enable you to meet the following goals:
· Understand the corporate tax formula
· Identify common book-tax differences and distinguish between permanent & temporary differences.
· Calculate the current & deferred income tax expense or benefit components of a tax provision.
Task: In order to successfully complete this assignment you must:
· Complete Celebrity Catering Service Inc.’s (CCS) Form 1120 and all related schedules. Be sure to attach schedules for any line item, which indicates one is required on the 1120. This includes line items that may require you to create a schedule that identifies the various items that are included in a line on the return these usually indicate “attach schedule.” Other lines will indicate specifically which schedule must be included with the return.
· The returns must be in.pdf format. The student can use either:
· Forms schedules and instructions found at www.irs.gov
· Tax preparation software may be used to prepare your assignment, but submission must still be in .pdf format.
· Include a list of all the judgments, decisions and assumptions that you made in order to complete the return. This should be submitted along with your return in a separate document.
Required:
· Complete Celebrity Catering Service Inc.’s (CCS) Federal Form 1120 and all related schedules for the tax period indicated in the financial statements provided. Be sure to attach schedules for any line item, which indicates one is required on the 1120.
· If any information is missing, use reasonable assumptions to fill in the gaps and list those assumptions as an attachment.
· Also list on the attachment any tax positions that you took in the completion of the return, such as depreciation method, elections, etc.
· The forms schedules and instructions can be found at www.irs.gov and download the necessary forms.
Criteria for Success: In order to earn maximum credit for this assignment be sure to review the grading rubric.
Rubric: Prepare a corporate tax return.
|
Dimension/Task |
Fair Quality (25 pt.) |
Average Quality (40 pts.) |
Excellent (50 pts.) |
|
Content- Book to Tax Differences – 40% |
Your return meets ANY of these criteria: · Several key items requiring special tax treatment were not identified. · M-1 reconciliation is completely incorrect. · M-1 reconciliation does not agree to return |
Your return meets ANY of these criteria: · A key item requiring special tax treatment was not identified. · Did not maximize allowable deductions. · M-1 is correct but does not agree to return. · M-1 agrees to return however the key items were not identified rendering it incorrect. |
Your return includes ALL of the following criteria: · Key items requiring special tax treatment were all identified. · Taxable income is correct · M-1 Reconciliation is correct |
|
Content- Balance Sheet – 40% |
Your return meets ANY of these criteria: · Balance Sheet out of balance. · Balance Sheet is incomplete. · M-2 is incorrect |
Your return meets ANY of these criteria: · Balance Sheet items are misclassified on the schedule. · Detail for accounts requiring attached schedules are missing or incomplete. |
Your return includes ALL of the following criteria: · Balance Sheet is correct. · Accounts requiring details are provided. · M-2 is correct |
|
Completeness-20% |
Your return meets ANY of these criteria: · Many schedules or forms are missing · Many schedules or forms are incomplete |
Your return meets ANY of these criteria: · Schedules or forms are missing · Schedules or forms are incomplete |
Your return includes ALL of the following criteria: · Necessary schedules and forms are provided. · Schedules and forms are complete. |
Celebrity Catering Services, Inc.
Rachael Ray, Paula Deen and Gordon Ramsay each own one-third of the common stock of Celebrity Catering Services, Inc. (CCS). CCS was incorporated on February 2, 2009. It has only one class of stock outstanding and operates as a C corporation for tax purposes. CCS caters to all types of social events.
· CCS is located at 540 Waverly Way Burbank, CA 91501
· Its employer ID is 38-4743474
· CCS’s business activity is catering food services. Its business activity code is 722300.
· The shareholders also work as officers for the corporation as follows:
· Rachael is the chief executive officer and president, (SS# 231-54-8976).
· Paula is the executive VP and Chief operating officer (SS#798-56-3241).
· Gordon is the VP of Finance (SS# 879-21-4536).
· All officers devote 100% of their time to the business and all of the officers are US citizens.
· CCS uses the accrual method of accounting, and the year-end as listed on the financial statement.
· CCS made four equal quarterly estimated tax payments of $600 each as well as an additional $300 paid with the extension. Its tax liability last year was $10,000. If it has overpaid its federal tax liability, CCS would like to receive a refund.
· The donations for 2021 qualify and the company would like to elect the increased charitable contribution limitation.
· CCS paid a dividend of $50,000 to each of its three shareholders on December 1. CCS had ample earnings and profits (E&P) to absorb the distribution.
CCS Corporate Tax Return Problem
1 | Page
|
Income |
|
|
|
|
Sales |
|
$3,022,480 |
|
|
Sales returns and allowances |
|
-13,000 |
|
|
Net sales |
|
3,009,480 |
|
|
Cost of goods sold |
|
1,124,500 |
[1] |
|
Gross profit |
|
1,884,980 |
|
|
Net loss on sale of investments and equipment |
|
$11,000 |
|
|
Dividend income |
|
28,000 |
[2] |
|
Interest income |
|
6,700 |
[3] |
|
Total income |
|
$1,930,680 |
|
|
Expenses |
|
|
|
|
Salaries and wages |
|
[4] |
|
|
Bad Debt |
35,000 |
|
|
|
Meals |
9,000 |
|
[5] |
|
Entertainment |
2,000 |
|
|
|
Repairs and Maintenance |
15,450 |
|
|
|
State Income Tax |
22,500 |
|
|
|
Payroll Taxes |
127,000 |
|
|
|
Charitable Contribution |
15,000 |
|
|
|
Equipment Rent |
37,000 |
|
|
|
Warehouse Rent |
60,000 |
|
|
|
Interest |
2,500 |
|
[6] |
|
Advertising |
2,500 |
||
|
Professional Services |
21,000 |
|
|
|
Depreciation |
14,350 |
[7] |
|
|
Employee benefits Programs |
37,000 |
|
|
|
Other Miscellaneous Expenses |
24,700 |
|
[8] |
|
Total expenses |
|
1,854,000 |
|
|
Net income before taxes |
|
$76,680 |
|
|
Federal income taxes |
|
(14,486) |
|
|
Net income after taxes |
|
$62,194 |
|
Additional information footnoted included on the following page. |
|
|||||||||||||||||
|
Assets |
1/1/21 |
12/31/21 |
||
|
Cash |
$726,150 |
$768,150 |
||
|
Trade and accounts receivables |
525,000 |
399, Collepals.com Plagiarism Free Papers Are you looking for custom essay writing service or even dissertation writing services? Just request for our write my paper service, and we'll match you with the best essay writer in your subject! With an exceptional team of professional academic experts in a wide range of subjects, we can guarantee you an unrivaled quality of custom-written papers. Get ZERO PLAGIARISM, HUMAN WRITTEN ESSAYS Why Hire Collepals.com writers to do your paper? Quality- We are experienced and have access to ample research materials. We write plagiarism Free Content Confidential- We never share or sell your personal information to third parties. Support-Chat with us today! We are always waiting to answer all your questions.  All Rights Reserved Terms and Conditions |